Executive search process: why the target market comes before the candidate list

Executive Search · Deep Dive

Executive search process: why the target market comes before the candidate list

Many C-level searches are reduced to names very early on. Who might fit? Whom do we know? Which candidates are available? The more important question comes first: in which market does the experience sit that is actually relevant to this specific task?

It is often at exactly this point that it is decided whether executive search leads to a robust leadership decision – or merely to a plausible shortlist.

A job description is not yet a search strategy

At C-level, it is not enough to describe a role by title, revenue size, team size and functional responsibility. Two CFO positions with an almost identical organisation chart can require completely different search markets.

One CFO is to professionalise a stable family business. The other is to prepare a private equity portfolio company for an exit. A third has to rebuild structures, systems and financing after a carve-out. On paper, these are three CFO roles. In the market, they are three different tasks – and thus three different candidate populations.

The same applies to CEO, managing director and executive board mandates. The title describes the hierarchy. It does not yet describe the challenge.

The target market is a hypothesis

A good search therefore starts with a hypothesis about where comparable leadership experience may have been gained. This hypothesis must be more precise than “same industry, similar size”.

Relevant factors include company phase, ownership structure and expectations, complexity, business model, internationality, pressure for change and the actual decision-making scope of the role. Only from this can one derive which companies and which leadership situations make sense as source markets.

The target market is not where the CV looks similar. It is where a comparable leadership task has already been solved successfully.

Five questions that change the search market

1. What must be visibly different in the first 18 months?

A succession in a healthy company requires something different from an appointment after missed targets, a change of ownership or a restructuring. Those who do not describe the desired result concretely usually search for the past rather than for future impact.

2. Which complexity must the person already have mastered?

Revenue size alone is a weak comparison. A company with EUR 500 million in revenue can be organisationally more complex than a billion-euro corporate division – for example through an extensive international footprint, decentralised structures, regulatory requirements or a fragmented value chain.

3. Which ownership and governance logic shapes the role?

A CFO in a family business works in a different decision-making architecture from a CFO in a PE portfolio company or a listed company. Professional competence may be comparable. The stakeholder capability required often is not.

4. Which experience is truly essential – and which merely familiar?

Many search profiles contain requirements because the predecessor had them. This narrows the market unnecessarily. The better question is: which experience actually reduces the appointment risk – and where can adjacent experience even offer an advantage?

5. Where would the best person probably be working today?

This is a different question from: who is currently looking for a new job? At C-level in particular, the relevant market is often passive. Good executive search work therefore does not begin with available candidates but with the actual market.

Why search markets that are too narrow are dangerous

Target markets that are too narrow initially seem efficient. They deliver well-known companies, familiar titles and supposedly easily comparable profiles. The problem: they often reproduce exactly the existing pattern.

If a company is supposed to change, a search for maximum similarity to the past can be contradictory. In transformation, growth or succession situations, it often makes sense to deliberately examine adjacent search fields.

This does not mean making requirements arbitrary. On the contrary: the further a search market is opened, the more precise the success criteria and exclusion criteria must be.

Why search markets that are too broad are just as problematic

The counterpart is a search along the lines of: “Let’s look at everything first.” That sounds open but quickly produces volume instead of insight.

A long longlist is no proof of quality. It may even be a sign that the search hypothesis is not sharp enough. Good market breadth does not mean including as many companies as possible. It means testing several logically justified search fields against each other.

The shortlist is the result of the market logic

Only when the relevant market is clear does candidate assessment become robust. Then it is possible to distinguish between someone who looks good formally and someone whose experience actually fits the task.

This also changes the discussion in the decision-making body. Instead of talking about individual names early on, it is first clarified what experience is being sought at all and why. This reduces the risk of well-known names or personal preferences dominating the search.

Executive search is therefore also market advisory

A good search process does not only deliver candidates. It provides robust feedback on whether the desired profile realistically exists in the defined market, which trade-offs become visible and which requirements may need to be adjusted.

In CEO search, CFO search, private equity mandates or complex succession situations in particular, this market information is part of the advisory service – not just a preliminary stage to the candidate list.

The practical consequence for owners and boards

Before the first direct approach starts, a decision-making body should be able to answer three things:

• Which concrete leadership task needs to be solved?
• In which company situations is the relevant experience gained?
• Which requirements really reduce risk – and which merely limit the market?

Those who answer these questions properly improve not only the search process. They improve the eventual decision.

A more detailed guide to preparing CEO and CFO appointments can be found in the Executive Decision Briefing. The fundamental advisory approach can be found under Executive Search.